Analysis for 'TV Everywhere'

I'm pleased to present the 338th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

Today we first dig into an idea Colin outlined earlier this week, that pay-TV could become a “dumb authentication service” as the trend of subscribers migrating their TV viewing away from set-top boxes and toward authenticated TV apps on connected TV devices gains momentum. This is an important shift that is already happening for many people (listen to our podcast 2 weeks ago for more).

In this model pay-TV operators still continue to authenticate viewers and manage billing, but do little else. In fact, the FCC’s current plans to “unlock the box” mean the scenario has even more credibility. We agree that’s a precarious place for operators to be and opens up opportunities for disruptors, like Amazon.

I'm pleased to present the 337th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

This week Colin and I discuss the highlights of Adobe’s new Q2 2016 TV Everywhere report. The headline data point is that 44% of time spent viewing TV Everywhere is actually happening via connected TV devices in the home. That’s up from 27% in Q2 ’15. Whereas TV Everywhere was touted as an on-the-go viewing feature, the new data suggests that most viewers instead look at it as a more convenient way to watch TV at home.

With the surge in connected TV viewing, browser-based time spent viewing share fell from 33% a year ago to 16% in Q2 ’16. Android was up from 11% to 13%, whereas iOS was down from 29% to 27%. More broadly, using Adobe’s data, Colin shares his calculations about how much TV Everywhere’s momentum slowed in Q2 ’16.

I'm pleased to present the 314th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

First up this week, Colin and I dig into the TV Everywhere awareness/usage data from Digitalsmiths’ Q4 ’15 Video Trends report. Both of us found it pretty sobering that 60% of pay-TV subscribers are still unaware of TVE services and usage has stalled out, despite the industry’s big bet. The data indicates that only around 10% of pay-TV subscribers use TVE on a weekly basis.

We then turn to the frustrations of buffering, which IneoQuest focused on in its “Buffer Rage” survey released this week. But despite the issues online viewers may be having with delivery quality, SVOD remains on a roll. DVDs have clearly been a victim of SVOD’s success and Colin notes that Digitalsmiths’ report found respondents’ usage of Redbox DVD kiosks dropped precipitously from 18.4% in Q1 ’15 to 13.1% in Q4 ’15. This week Redbox’s parent Outerwall said it was exploring “strategic and financial alternatives.”

60% of pay-TV subscribers are still not aware of TV Everywhere apps allowing TV viewing on mobile devices. That’s one of the key highlights of the 13th edition of the Digitalsmiths quarterly Video Trends Report, for Q4 ’15, which surveyed 3,100 consumers. The 40% awareness level is up just 3.7% since Q4 ’13 and 13.6% since Q4 ’12.

Worse, the Q4 ’15 report found that 21.5% of pay-TV subscribers have their pay-TV provider’s app on their mobile device, a decrease of 3.7% since Q4 ’13 and 4.5% since Q4 ’12. Among those who use their pay-TV provider’s app, 45.4% use it on a weekly basis, flat from Q2 ’15 but up 3.6% from Q3 ’15 when it dipped.

In a sign of how extensively connected and mobile devices have proliferated, video ads viewed on them have surpassed video ads viewed via browsers on desktops and laptops for the first time, as measured by FreeWheel in its new Q4 ’15 Video Monetization Report.

TV Everywhere is the great hope of the pay-TV industry to combat viewers from defecting to OTT. But pinning down actual TVE usage remains murky at best.

For example in its Q4 2015 Digital Video Benchmark released last week, Adobe found that 17.4% of pay-TV viewers used TV Everywhere at least once per month. That was the highest level of TVE usage Adobe has found, rising above the 13%-14% range of usage over the past 4 quarters.

The NFL announced yesterday that it was splitting broadcast rights to Thursday Night Football in 2016 and 2017 between CBS and NBC. The WSJ reported that each network will pay $225 million for the annual rights, a 50% increase over the $300 million per season that CBS alone had been paying.

But the higher broadcast fees are just the beginning of how the NFL will more fully monetize the upcoming seasons. More intriguing were the sentences from the NFL’s press release: "The NFL is in active discussions with prospective digital partners for OTT streaming rights to Thursday Night Football. A deal announcement is expected in the near future."

FreeWheel has released its Q3 ’15 Video Monetization Report (VMR), which reveals the continuation of a number of important industry trends. Both ad views and video views grew 28% vs. Q3 ’14, consistent with growth rates seen over the past few quarters.

Live video was once again the fastest-growing genre, with a 113% year-over-year growth, compared to 30% for long-form and 9% for short-form. Sports was again the biggest driver of live with 63% of sports video viewed live, compared with 17% of news video viewed live (other genres were in low single digits). News had the biggest proportion of short-form (76%), while Entertainment (60%) ad Kids (59%) had the biggest proportion of long-form.

New research from Digitalsmiths shows relatively muted interest in switching/dropping pay-TV providers, strong appeal of customized, a la carte pay-TV channel lineups, high awareness and usage of OTT services, and low adoption of TV Everywhere, among other things.

Just 7.7% of respondents said they’d switched pay-TV providers in the last 3 months (up from 6% in Q2 ’14). Less than 15% of respondents said they might either cut their service, switch to pay-TV providers or move to an online app or rental service in the next 6 months, an improvement vs. Q2 ’14.

While 76.6% of pay-TV subscribers are satisfied or very satisfied, 23.4% are unsatisfied, an increase of 6.1 percentage points since Q2 ’13. For those unsatisfied, the top 3 reasons were “increasing fees for cable/satellite service,” “increasing fees for Internet service” and “poor customer service.” Digitalsmiths found the top 3 predictors of satisfaction were monthly bill, ease of finding linear content and ease of finding VOD content.

Last Friday Adobe released its U.S. Digital Video Benchmark for Q2 ’15, showing, among other things, surprisingly stagnant adoption of TV Everywhere over the past 4 quarters. According to Adobe, active viewership of TVE among pay-TV viewers stood at 12.7%, exactly the same rate as in Q3 ’14 (and down a bit from 13.2% in Q1 ’15). However, the Q2 ’15 rate of 12.7% was 19% higher than the 10.7% rate Adobe recorded in Q2 ’14.

With talk of cord-cutting everywhere these days, independent ad-supported cable TV network Tennis Channel is showing early signs of success with a compelling new model in which linear, TV Everywhere and OTT converge to super-serve audiences and reinforce the value of sports on pay-TV.

At the 2014 French Open, Tennis Channel launched"Tennis Channel Plus" which runs $12/month or $80/year. Tennis Channel Plus now provides access to over 650 live events per year and over 1,000 hours of on-demand viewing. This means Tennis Channel adds broader coverage of tournaments it already broadcasts on linear, plus streaming of tournaments it hasn't previously covered.

I'm pleased to present the 275th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

We all know the video industry is undergoing unprecedented changes. To make things more tangible, in this week's podcast, we discuss recently released data that we believe illustrates well how different the industry and viewers' behaviors are today vs. just a few years ago.

The overarching takeaway is that in the past 5 years, online video has evolved from a short-form, lower-quality, desktop-based experience to a long-form, TV-level experience that's now mainstream in the living room. As this trend gains further momentum, there are huge implications for TV networks, pay-TV operators and advertisers.

FreeWheel has released its Q1 '15 Video Monetization Report, which reinforces many of the key trends seen in recent quarters. Of note, TV Everywhere viewing increased 328% vs. Q1 '14, now accounting for 57% of long-form content viewed. Once again, live content grew the fastest, up 140% year-over-year. Sports accounted for 82% of live ad views, basically flat from Q4 '14.

NBC Sports Live Extra app is now available on both Roku and Apple TV, with the caveat that only authenticated pay-TV viewers will be able to access the app's 3,000 annual live sports streams. The move bolsters TV Everywhere, the pay-TV industry's initiative to enable access to content when, where and how viewers want it.

New research validates the key assumption that TV Everywhere adds critical value to the increasingly expensive pay-TV subscription. In a survey, HUB Research has found that 82% of heavy TVE users rate pay-TV a "good" or "excellent" value vs. 52% for light TVE users, and just 48% for non-TVE users.

That's encouraging news for the pay-TV ecosystem, however, just 16% of subscribers are actually heavy users, using TVE several times per week or every day). Importantly though, 30% of millennials identify themselves as heavy users. Clearly a key industry challenge is to raise TVE awareness and usage.

I'm pleased to present the 269th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

Colin and I were both at the NABShow this week. I was hosting the inaugural NAB's inaugural Online Video Conference, which featured over 40 industry executive speakers. In today's podcast we share 4 main takeaways from the NABShow, including the shift to cloud/IP, the rise of TV Everywhere, the personalization of video and why drone-based video is so compelling.

Over the past year, a strong wind has blown in the sails of the TV Everywhere market. More content owners are making programming available on this increasingly popular platform and the content is finding an audience on programmer and operator apps across platforms. Adobe reports TV Everywhere and online video consumption is up 146% in the last year. Ad server company FreeWheel noted that 38% of all ad views on long-form and live content came from behind authentication walls. NBCU made a push for TV Everywhere education with its Super Stream Sunday that offered open access to its Super Bowl-related programming.

Riding high on this growth, the industry should now focus on how to make the opportunity even bigger. Based on our ongoing work with programmers and MVPDs on authenticated video, as well as our data analysis of sources such as watch app reviews, below is a sample of the strategies we think will help take watch apps to the next level:

2014 was the year during which the "Big Game" became the "Really Big Game." From the Super Bowl and Sochi Olympics kicking off the year, to the college football Bowl Season closing it out. One could hardly turn around in 2014 without hearing of another programmer boasting cutting-edge streaming coverage of tent-pole sporting events or unprecedented depth of exposure for previously hard-to-find games.

Live sports serve a dual function for programmers trying to expand their digital footprint. In addition to bringing significant numbers of viewers to ultra-premium, high-CPM ad inventory, live sports have also been deployed as an entry point - hooking new adopters and indoctrinating digital viewing habits.

More evidence of TV Everywhere's momentum today, as FreeWheel's Q4 2014 Video Monetization Report found that 56% of long-form and live ads were viewed via authentication. That's more than 4x greater than the 13% authentication rate for long-form content in Q4 '13. Total long-form viewing was up 43% in Q4 '14 vs. the prior year.

The new data follows Comcast's news last week that 30% of its Xfinity TV subscribers use TV Everywhere monthly. (Note Comcast owns FreeWheel).

Turner Broadcasting System Latin America has launched a new OTT service in Latin America and Brazil, powered by Kaltura's OTT TV platform and IBM's SoftLayer cloud infrastructure.

The service is being offered in Spanish and Portuguese and is available on iOS and Android smartphones and tablets. It includes both live TV channels and VOD options. Notably, it is being offered through Turner's pay-TV partners, so it does not appear to be disruptive to the existing ecosystem, but rather a TV Everywhere extension.

Our Sponsors

About VideoNuze

VideoNuze is the authoritative online source for original analysis and news aggregation focused on the burgeoning online video industry. Founded in 2007 by Will Richmond, a 20-year veteran of the broadband, cable TV, content and technology industries, VideoNuze is read by executive-level decision-makers who need to get beyond the standard headlines and achieve a deep understanding of online video’s disruptive impact.